The Georgian economy is expected to expand by 3.5% in 2021, rebounding in line with the gradual lifting of the coronavirus (COVID-19) pandemic restrictions and the revival of domestic demand, according to a new Asian Development Bank (ADB) report.
In its Asian Development Outlook (ADO) 2021, the bank’s main annual economic publication, ADB also projected that Georgia’s GDP growth would accelerate to 6% in 2022 as the full reopening of the economy and the expected recovery in tourism boost travel and commerce.
“As a tourism-dependent economy, the gradual lifting of pandemic-related restrictions should revive the country’s growth this year and accelerate it in 2022,” said ADB country director for Georgia Shane Rosenthal. “While the vaccine rollout will be key to a fast recovery, increasing access to finance for small and medium-sized enterprises, expanding e-commerce, and transforming agriculture to boost food exports will be vital to Georgia’s long-term economic growth and the livelihoods of Georgians.”
The ADB projected that inflation would slow to 5.0% in 2021 and 3.5% in 2022, although this would be above the National Bank of Georgia’s inflation target of 3.0%. The current account deficit is expected to narrow to 10% of GDP in 2021 and 7% in 2022 as the merchandise trade balance and tourism gradually improve.
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